Let's Make A Deal And Kick the Can Down the Road

October 1st, 2013

This piece was very difficult to write. Influencing what was finally written were: too many false starts and stops to count; changes in strategy; different proposals and the real possibility of coming up with nothing. The shutdown and deficit ceiling part has been rewritten at least five times and this opening three different times.

Originally, the title for this piece was “Oh, No! Not Again, or To Be or Not to Be That is the Question,” for the ongoing shutdown, but there was a deal that ended the stalemate late on Wednesday, Oct. 16. However, the pain is not over, nor are the negotiations to solve all of the issues that forced the closure and the brink of not increasing the debt ceiling.

The “deal” crafted by Senators Harry Reid and Mitch McConnell, and several senators from both parties passed both houses of Congress and was signed by the President, was a short-term fix. This is the reason for the revised title. The deal was not a fix but a temporary band-aid.

The deal has three key components. First, begin bicameral bipartisan budget negotiations by conferees before Dec. 13, and those have already begun. Second, the Continuing Resolution (CR) for government funding only extends to Jan. 15, 2014, or we could be faced with another shutdown. And third, the debt ceiling has been increased until Feb. 7, when we may have to go through the same drama.

Hopes are not great for a long-term pact, but lessons may have been learned from this episode that will create the environment to address the following: a long-term increase in the debt ceiling; a long-term CR or appropriations; sequestration which occurs again on Jan. 15; and deficit a reduction strategy that includes some tax and entitlement reform as well as tax revenue. The other factor effecting more cooperation, as well as push back from tea party members in Congress, are the upcoming 2014 mid-term elections. Both sides of the aisle are concerned about the impact of the inability of Congress to function on what voters do at the polls both in the upcoming primaries and November 2014.

An Analysis of What Transpired

Congress behaved in the seasonal mode — Trick or Treat as it tried (only half-heartedly) to reach an accord in the efforts to end the shutdown, increase the debt ceiling and build a real budget deficit reduction strategy. It became a drama with a never-ending number of acts. It came down to the bitter end for a passable compromise. This was a result of the warring factions among House Republicans and prodding from a handful of very conservative Senate Republicans to hold their ground. With the compromise, the war has not ended.

This is not how mature responsible adults are supposed to work together. This is not how elected officials work in the best interest of a nation, especially this one. Unfortunately, the last few weeks have shown that political positions and ideology trump the best interests of this nation’s citizens, economic interests and world standing. There is enough blame to go around to all involved. One word describes the behavior – SHAMEFUL.

Unfortunately, these last few weeks have all been about the ongoing inability, ineptness and seeming unwillingness of members of Congress and the Administration to work together and find common ground. The shutdown was worse than 17 years ago, because it was coupled with sequestration and the need to increase the nation’s debt ceiling. Also, there was even a greater political ideological divide within Congress, especially in the House. This all occurred while the nation is in the midst of an economic recovery rather than an economic boom. Inaction would have created another recession.

Depending on to whom you talk, there are some winners and losers, or at least some who seem to fare better than others, given their roles during this Congressional and Administration theatre. Speaker John Boehner, whose speakership was thought to be on the ropes, will survive. Senators Harry Reid, Mitch McConnell, Susan Collins, Joe Manchin and a few other senators’ stock has risen. House Minority Leader Nancy Pelosi stock also rose because she continued to offer to work with the Speaker and deliver her block of votes to end the shutdown. The obstructionist tea party members in both the House and Senate have lost something, but it is not clear what and for how long. That will be determined by several upcoming votes in Congress and the results of several primaries before the mid-term elections. Senator Rand Paul came out untainted by the actions of others, namely Senator Ted Cruz, whose stock may have fallen with some and rose with others. Time will tell.

The 2013 Budget War

Foreign nations wondered if the President was in charge. Others query if the U.S. had lost its ability to govern and be a leader? What picture was painted? And some even viewed it as a comedy routine similar to Abbott and Costello’s “Who’s on First?”, or just a comedy of errors. Maybe, it was just science fiction and aliens had taken over the Congress. Any one of these were (and still are) plausible, given how the Congress and the President were not able to effectively address the problems of government funding, the debt ceiling, deficit reduction and sequestration.

If one did not know better, someone from another world would have thought the current budget and funding script was political theatre. Unfortunately, these actions have been all too real.

The shutdown was driven by strident ideological differences between the political parties and, in part, among House Republicans and a few Senators. Once Congress reached the brink, it took the Senate leadership to craft the compromise to reopen the government. It is not clear if a significant number of Republican House members wanted a clean CR with no strings so the government would go back to work. House Speaker John Boehner would not allow the House to vote on a clean CR in part due to his caucus.

Normally, any individual lawmaker would be able to force a vote on a bill where there is a dispute between the House and Senate, but on Oct. 1, the House Republicans passed a resolution — H. Res. 638 — altering the rules to make that impossible. (For balance, the Democrats did something similar several years ago when they were in control of the House.) Also, there are many who believe that if Boehner allowed a vote, his speakership be in danger, — it still is no matter what the final outcome.

Yes, there was suspense, as well as posturing and role-playing. Victims of this political dance of chicken included small business, veterans, federal employees, federal contractors, the poor and low wage employees, and senior citizens.

Education and Related Issues To Be Addressed When the Dust Settles

College Rating System

In August, President Obama announced an ambitious new agenda to combat rising college costs, encourage colleges to improve their value and empower students and families with information to make informed decisions about which college to attend.

The President’s plan includes three steps: paying for performance, promoting innovation and competition, and ensuring that student debt remains affordable. As part of this proposal, the President directed the department to develop a rating system to better inform students and encourage colleges to improve. The ratings will compare colleges with similar missions and identify those that do the most to help students from disadvantaged backgrounds, as well as those that are improving their performance. In the future, the rating system could steer taxpayer dollars toward high-performing institutions.

To develop the college rating system, the U.S. Department of Education is seeking the best ideas and most creative thinking on some key themes:

College access, such as the percentage of students receiving Pell Grants;

College affordability, such as average tuition, scholarships, and loan debt; and

Outcomes, such as students’ graduation and transfer rates, graduate earnings, and advanced degrees of college graduates.

In September, the department launched a nationwide series of public discussions by convening student advocates and leaders — since students will benefit the most from these efforts. Over the coming months, department officials will travel across the country to host open forums, roundtable discussions and town halls to gather suggestions. And, members of the general public are invited to send their suggestions to collegefeedback@ed.gov.

Education Secretary Arne Duncan spoke at the TIME Summit on Higher Education, highlighting the President’s plan and discussing the challenges of assessing the affordability and value of college. “We know there are no silver bullets or easy solutions here, but we also know we can’t let the difficulty of the challenges facing higher education become a discussion-ending excuse for inaction,” he said. “We very much want — and need — the benefit of your collective guidance and wisdom about how to design a rating system that ensures America’s extraordinary system of higher education continues to thrive, grow and strengthen our entire nation.”

To say everyone is happy or enthralled with the proposal would be an overstatement. It is controversial, but the proposal does raise some important issues about higher education and accountability where there has been none. One fundamental question is: should there be accountability for higher education institutions as there is for elementary and secondary schools?

This comes when there has been interest in both the House and Senate to begin the process to reauthorize the Higher Education Act. And the Senate has scheduled a series of hearings that were delayed by the shutdown.

Immigration Reform

President Obama is going to try to use the momentum from reopening the government to renew efforts to again attempt immigration reform in the House by the end of this year. And Senate Democratic leadership will renew its efforts to get a final deal on immigration reform. There is already some push back by conservative House members as a result of the recent reopening of government. Given legislation has already passed the Senate, the House leadership has said it will pursue a series of smaller bills that some conclude is a way to kill any deal.

Tax Reform

This is a big unknown. Senator Max Baucus (D-MT) and Congressman Dave Camp (R-Midland) have been working together on this in a bi-partisan fashion. They have received from members of Congress suggestions and ideas on what should be changed and revised in the tax code. Each is writing a bill. It is unclear how much they will have in common and whether it will be completed in the near future though they both promise the bills will be ready soon. Baucus is also retiring at the end of 2014 and he would love this to be his swan song.

Legislative Reauthorizations Backlog

Numerous bills are long overdue for reauthorization including a slew in education and closely related issues. These include the Elementary and Secondary Education Act (ESEA), Workforce Investment Act, Career and Technical Education Act (Perkins Act), Institute for Education Sciences, Child Care Block Grant, Farm Bill and several others that are all but one being the responsibility of the House Committee on Education and the Workforce and the Senate Committee on Health, Education, Labor and Pensions.

Elementary and Secondary Education Act

Both houses have passed bills to reauthorize ESEA (aka No Child Left Behind), but there is not much agreement in either bill or any conference committee planned. Philosophically, the divide is wide and there does not seem to be any plan to try to bridge it unless there is an interest to give Senator Tom Harkin (D-Iowa) a legacy, given he will be retiring at the end of 2014. Congress is not happy with the waivers that have been given to states to provide them more flexibility in adhering to the No Child Left Behind Act. Some believe this strategy has been enacted in lieu of reauthorization and may provide an impetus to get a bill finalized. The Senate HELP Committee has just issued a detailed report on its bill that has passed out of the committee entitled the Strengthening America’s Schools Act. It can be accessed at: http://1.usa.gov/16J5G6e

Career and Technical Education Act

Closely linked to ESEA is the Perkins Act, which originally was for vocational and adult education but now focuses on career and technical education. This would embody some of the high school reform proposals of the Obama Administration. This could be coupled with ESEA, but it is unlikely. There is a need to revise the legislation, as the area of career and technical education has changed significantly since its last authorization.

Workforce Investment Act

The Workforce Investment Act (WIA) is also long overdue. Several attempts have been made to rework the legislation, but each time it has failed. The differences between the House and Senate bills have been too great, both philosophically and practically. Maybe over the next six months the rewrite can be accomplished because of the great need to improve the workforce development and training system in the country.

The Farm Bill

The Farm Bill is very close to being finalized. The sticking point was in the House when it took out the Food Stamp portion of the bill and made it a separate piece of legislation. If it were not for the shutdown and the debt ceiling, this bill would have been finished and most likely will be completed before the end of the year. It provides some very distinctive changes for agriculture, school nutrition and the food stamp program.

One casualty of the delay in reauthorizing the farm bill is the insurance reimbursement to cattle farmers for the cattle killed as a result of the freakish snowstorm in South Dakota. Without reauthorizations, there is no program authorized to provide the funds.

Early Learning Legislation

Of all the education issues, early learning or early childhood education has percolated to the top and become more salient. From several different sectors, it has become a number one issue. This includes the business community, educators, researchers and politicians. It has gained momentum for legislation and financial support both at the federal and state levels. The Obama Administration is crafting legislation with Democratic members in the House and Senate to strengthen existing federal program efforts. Individual states have begun to fund early learning because there is now a better understanding of the need for early preparation prior to entering kindergarten.

ConnectED (better known as the E-Rate)

The E-Rate is long overdue for a revision and the Obama Administration has proposed ConnectED as the update given the improvements and changes in technology. This would change the acceptable uses of funds by school districts and libraries from grants by the Universal Service Fund managed by the FCC. Moving more to a focus on broadband, wireless and access from the hardwiring during the initial years of the E-Rate. This, too, might become legacy legislation for Senator Jay Rockefeller who is retiring at the end of 2014.

In Closing

Where does the shutdown and other pending decisions leave us? No one is quite sure, but the educated guess not in an enviable economic position if nothing can be resolved for the long-term.

Also, no one in Congress has stepped up to the plate to halt sequestration or even raise the possibility. Some individual members have made murmurings, but no word from the Congressional leadership that is needed to do something. But that would require the two parties to come together to address the budget deficit and a reasonable long-term budget strategy and stick to it.

The bigger question that needs to be addressed is the long-term solution so that we don’t go through this process every year or again this fiscal year. There is also a need to come to an understanding for a process to address the debt ceiling without political conditions, and finalize appropriations by the beginning of each fiscal year. But this may be too much to ask, given the current political climate and participants.

Some may be asking — will they ever grow up? Will they ever learn it is not about them but the nation and its citizens?